Partnership Voluntary Arrangement or PVA
If the partners believe in the viability of the business going forward then this powerful rescue mechanism exists as a framework for the restructuring of the business.
It must be understood that this mechanism is not easy; the partners must be prepared to prove viability of the business and the partner’s estates must be solvent prior to the PVA being proposed. Should the partner’s estates be insolvent then it may be best to do Individual Voluntary Arrangements (IVA) for all partners and bypass the PVA.
This procedure is a way of effecting a deal between the insolvent partnership and its unsecured and preferential creditors.